Iran has issued a stark warning of a "full-strength" response to any military attack, escalating regional tensions amid ongoing geopolitical instability. The threat primarily affects risk appetite and oil supply security, with potential spillover effects on global energy markets and shipping lanes in the Strait of Hormuz. Energy equities, Middle Eastern currency pairs, and oil-sensitive commodities are particularly exposed due to the region's critical role in global crude supply. Any direct confrontation involving Iranian assets or infrastructure could trigger a sharp repricing of geopolitical risk premiums in oil futures and safe-haven demand for gold and U.S. Treasuries. Traders will closely watch for developments in U.S. naval deployments and Iranian military activity as near-term catalysts.
Iran Threatens Strong Retaliation to Military Attacks
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